New Listing

Melanion Capital to launch bitcoin equities ETF

Tracks an index of 30 companies with high revenue exposure to bitcoin

Tom Eckett

a group of gold coins

French investment manager Melanion Capital is set to unveil a bitcoin equities ETF that offers exposure to companies with high revenue exposure to the cryptocurrency.

The Melanion BTC Equities Universe UCITS ETF will list on Euronext Paris with a management fee of 0.75%.

The ETF will replicate the Melanion Bitcoin Exposure index which tracks a basket of 30 equities that are highly correlated to the price of bitcoin.

In particular, companies included in the index operate in areas such as crypto asset management, crypto banking, crypto mining, blockchain technology or hold cryptos on their balance sheet.

To avoid concentration risk, each constituent is capped at 10% and weights are adjusted to limit the impact of a single day trading to 25% of value traded for any constituent.

The firm said the ETF has a 90% correlation to the price of bitcoin.

Cyril Sabbagh, head of ETF at Melanion Capital, commented: “Bitcoin’s main concerns for institutional investors are hack, theft, loss, storage, security and crime.

“By investing in equities replicating the bitcoin performance, investors can achieve diversified asset allocation.”

A number of issuers have started to offer exposure to this segment of the market. In May, VanEck unveiled Europe’s first ETF that offers exposure to companies involved in the crypto and blockchain industries, the VanEck Vectors Digital Assets Equity UCITS ETF (DAPP), ETF Stream revealed.

Meanwhile, there are currently two blockchain ETFs available on the European market. The largest is the Invesco Elwood Global Blockchain UCITS ETF (BCHN) which has $983m assets under management (AUM), while the First Trust Indxx Innovative Transaction & Process UCITS ETF (BLOK) has $117m AUM.

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